SoFi Technologies came under notable selling pressure on Tuesday as renewed scrutiny from major Wall Street firms weighed on investor sentiment.
Although recent equity raises have materially strengthened the company’s balance sheet, analysts remain divided over whether SoFi’s current valuation leaves meaningful room for additional upside.
Bank of America Maintains Cautious Outlook
Shares of SoFi Technologies (NASDAQ: SOFI) tumbled roughly 8% during Tuesday’s trading session following updated commentary from Bank of America, which reiterated its cautious outlook on the fintech company.
In a research note, Bank of America analyst Mihir Bhatia reaffirmed an “Underperform” rating on the stock while raising the firm’s price target to $20.50 from $17.50. Despite the increase, the revised target remains well below SoFi’s recent trading price of $26.99.
According to the firm, the primary constraint on the stock is valuation. Bank of America sees limited upside at current levels, arguing that a significant portion of SoFi’s long-term growth potential is already reflected in the share price. The price objective is based on a valuation of 22 times estimated 2027 earnings.
Despite its valuation concerns, Bank of America acknowledged recent improvements in SoFi’s financial flexibility. In December, the company completed its second equity raise of 2025, issuing 54.5 million shares and generating approximately $1.5 billion in proceeds for general corporate purposes.
Earlier in the year, SoFi raised an additional $1.7 billion through a separate equity offering. Combined, the two transactions lifted total capital raised in 2025 to more than $3 billion, according to Bank of America.
The firm characterized the additional capital as a modest positive, noting it provides greater flexibility to support ongoing growth initiatives.
Growth Opportunities, but Limited M&A Ambitions
Even so, Bank of America tempered expectations around major strategic transactions. Any acquisitions are expected to be small and incremental rather than transformational in nature.
The analyst suggested SoFi Technologies could show interest in niche areas such as crypto-related services or prediction market capabilities, but emphasized that large-scale mergers or acquisitions are unlikely.
Alongside its valuation update, Bank of America made minor revisions to its earnings outlook. The firm now forecasts adjusted earnings per share of $0.39 for 2025, $0.64 for 2026, and $0.93 for 2027, representing only modest changes from prior estimates.
Street Views Remain Mixed
While Bank of America maintains a cautious position, other Wall Street firms offered a range of perspectives.
Barclays analyst Terry Ma raised the firm’s price target to $28 from $23 while maintaining an “Equal Weight” rating. Barclays expects a more supportive credit environment ahead. The firm also anticipates stronger loan growth and an improvement in mortgage origination activity in 2026.
In contrast, Goldman Sachs analyst Michael Ng adopted a more restrained view, lowering the firm’s price target to $24 from $27 while keeping a “Neutral” rating.
Overall, analyst sentiment toward SoFi Technologies (NASDAQ: SOFI) remains divided. The company’s strengthened capital position provides support, but elevated valuation levels continue to shape expectations. As a result, investor confidence appears to be highly sensitive to the execution of growth initiatives and greater clarity around future earnings visibility.
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